More news and other items from the past week.
Tenants win out of court settlements for ‘No DSS’ discrimination
Landlords and agents are reminded that banket bans against ‘DSS’ tenants risk claims for indirect discrimination.
The matter is yet to be decided on in a court hearing, but a report on the BBC shows that two more tenants have been paid compensation in out of court settlements.
We discussed the law on this here, after the Rosie Keogh case in 2018.
Prosecuting the short term letting portals
An interesting post on LinkedIn from David Smith discusses how aggrieved landlords whose properties have been advertised without their consent could bring a prosecution under the little known Accommodation Agencies Act 1953.
This act makes it a criminal offence to, among other things, issue
any advertisement, list or other document describing any house as being to let without the authority of the owner of the house or his agent.
As fines are limited to £1,000 the portals would not take much of a financial hit but the bad publicity would not help them. Find out more here.
Problems with the new electrical Safety Regulations
The RLA have spotted an issue with the new electrical safety regulations, currently making their way through Parliament:
The regulations are due to come into force from June this year and will immediately remove the obligation for landlords to carry out electrical safety checks in Houses of Multiple Occupation (HMOs).
The electrical safety obligation under the new rules will not apply until a tenancy is renewed or April 2021, whichever comes first.
This will leave some rental properties under no legally binding electrical safety regime for the interim period, leaving tenants without the assurance that properties are safe.
The RLA is calling on the government to delay the issue of the regulations until these issues have been sorted out.
How long will RoPA be delayed?
A presentation at the recent NAEA Propertymark conference in London from Matt Prior, representing the housing directorate of the Ministry of Housing, Communities and Local Government has led delegates to conclude that the RoPA (Regulation of Property Agents) proposals from Lord Best’s working party, may not see the light in this Parliament.
Prior is reported as saying
The thing to bear in mind is that RoPA is not a small undertaking and is not something you just do in half an hour and, although we do have five years [before the next election], we also have a lot of [other] legislation to get through.
It’s also about identifying when would be an appropriate time slot; as you may appreciate every government department comes forward with a list of things they want to do.
It’s certainly on the priority list but where it sits on it, I don’t know.
This did not go down well, with one agency leader, who wished to remain anonymous, saying that ministers’ reluctance to prioritise RoPA would give the wrong message to the cowboys within the industry.
Licensing schemes rejected
Landlords are celebrating after two high profile landlord licensing schemes have been rejected by the government:
- Liverpool’s application to extend its citywide licensing scheme, and
- a similar application by Brent Council
John Stewart, Policy Manager for the Residential Landlords Association, said:
We all want to see bad landlords driven out of the sector. However, licensing is not the answer. All it does is identify the good landlords who register and then tax them. They do nothing to flush out the criminals who stay under the radar.
Instead, councils should use the wealth of data they can already access to find landlords and target resources to properly enforce the wide range of powers they have to deal with unsafe and sub-standard rented housing.
Landlords – beware of buying properties subject to improvement notices
An article in LandlordZONE reports on a case where a purchase was fined £15,000 – even though the fault was with the vendor, not the purchaser.
David Smith, policy director at the Residential Landlords Association, told LandlordZONE that landlords need to be cautious about buying properties with notices and engage actively with local authorities if they do, but saying
At the same time, local authorities should look to work with landlords buying properties that need work as they are potentially there to sort things out and so they must engage positively with them.
More landlords turning to self-management
It looks as if due largely to hikes in letting agent fees, more landlords are dropping them and managing their properties on their own. For example, the average letting fee is up some 58%, from £2,026 in 2018 to £3,221 in 2019.
CEO of the NLA Richard Lambert said:
The tenant fees ban was always going to lead to agents trying to charge landlords more in order to recoup costs and maintain their margins. The only question was how much of a hike landlords would be prepared to accept. Landlords are voting with their feet and opting to forego paying inflated fees for the services of letting agents.
This goes to show that landlords will only pay what they believe the service is worth and no more. A good letting agent can provide a great deal of value to landlords who do not wish to manage their own properties, but this shows that it is not essential to an increasing number of landlords.
Responsible landlords can, and do, self-manage, saving themselves thousands of pounds.
The problem is that the sector is now so heavily regulated that landlords risk prosecutions, fines and penalties for non-compliance. So any landlords looking to self manage should take a look at my Landlord Law service.
Warning – insurance policies will start to include ‘Airbnb clauses’
LandlordZONE reports that a new question to be asked of policyholders could be a ‘game-changer’.
The question property owners will soon be asked when applying for insurance is whether they intend to rent out their properties via short-let platforms. Which means that, soon, homeowners and landlords will no longer be able to use short-term let platforms like Airbnb without knowingly breaching the terms of their policy.
Louise Birritteri of specialist insurer PIKL told Landlord ZONE:
This development is significant because one of the biggest challenges is identifying who is doing short-lets rentals and making sure they get the correct kind of insurance.
We found that insurance companies, brokers and price comparison websites were not determining, in their traditional customer journeys, whether those taking out cover were short term letting. Without collecting this information, customers are at risk of unintentionally taking out cover that may be inappropriate for them or could be voided by their sharing activity.
So be careful when taking out new insurance policies.
- Police force admits it did not have time or resources to investigate fraud agent
- Nine Years’ rent confiscated from Landlord in Brent
- Jailed letting agent ordered to repay victims less than a quarter of money that she stole
- New immigration rules won’t affect Right to Rent until 30th June 2021
- Tenants dealt ‘huge blow’ as rents rise amid falling supply and record demand
- MEES Regulations: What you can do to prepare for the legislation deadline
Newsround will be back next week.